Non-Contiguous Law School Mergers

The recent news out of Saint Paul, Minnesota that William Mitchell and Hamline are merging their law schools was intriguing in many ways, not least because of the ways that this announcement fueled speculation that Mitchell/Hamline was just the first in a series of soon-to-be-made announcements as to forthcoming law school mergers.  In this ongoing speculation, I have been struck how the focus is usually on certain states and/or metropolitan areas—Illinois/Chicago; Pennsylvania/Philadelphia; Massachusetts/Boston are often mentioned—as if mergers have to happen, or would be most advantageous to all stakeholders, if they happened in contiguous areas.  Part of my scholarship is focused on non-territorial forms of governance, and I was also born and raised in one part of the non-contiguous state of Michigan, so I have been interested for some time in the continuing power of Westphalian ideas of (territorial) imagining and belonging.  Relatedly, I wonder (in the context of legal education):  Why not have the next wave of law school mergers happen in an inter-urban, inter-stitial, and/or inter-national manner?

Indeed, in some ‘local’ contexts, mergers of existing law schools may be especially difficult or impossible.  At the very least, familiarity can breed contempt, especially if one is overly familiar with the historical patterns of student recruitment/raiding/free markets operating in one’s local law school market.  Alternatively, local merger options may not be attractive (for either party) because of serious differences in law schools' finances, mission, good governance, and/or student and faculty diversity.

What might the (ostensibly) oncoming wave of mergers look like instead?  Might there be a New York law school looking for a Los Angeles mate?  Can the Jesuit mission extend from San Francisco to Saint Louis, or would such a match fall the way of East and West Pakistan?  Are there candidates for a more intense U.S.-Canadian partnership than that found between Detroit and Windsor?  Wouldn’t every budding common-lawyer like a New Orleans outpost in the civil jurisdiction of Louisiana?

Comments

[Jojo]

You realize that these mergers are not desired by their institutions or some sort of strategic empire building. They're about cost cutting and survival. The focus is on geography, because that's how you cut costs. You shed overhead and cram 2 schools' worth of loan conduits into 1 school's worth of seats.

[Jeff Redding]

"Geography" can extend over lakes, rivers, counties, and state and international borders. It's not clear to me that there aren't at least some (cost-saving) synergies and possibilities in some places--for example, Philadelphia and NYC--that people aren't commonly contemplating.

[Anonymous]

What would be the primary benefits of, as you say, a school in Philadelphia merging with a school in New York?

[Observer]

"Can the Jesuit mission extend from San Francisco to Saint Louis"

San Francisco to Santa Clara is more plausible.

[[M][@][c][K]]

The Hamline/Mitchell merger was a non very well disguised closure of Hamline, done in such a way as to save face at the parent institution. It is hard to see how a nno contiguous merger would achieve the objective that Hamline/Mitchell did.

[anon]

“loan conduits”

Brilliant. Kudos, Jojo.

[Guest]

Respectfully, potential mergers aren't about broadening/improving legal education. They are made from a pure business perspective to save as much of the failing business as possible. Since the stakeholders and the decision makers are the tenured professors and administrations of the failing institutions themselves, merger would only work if the other aspects of the business are sacrificed: real estate, non-tenured faculty, staff, overhead. None of that can be achieved to a sufficient degree by merging non-contiguous law schools. That's why Vermont Law is seeking a tie-up with the University of Vermont and Albany Law is seeking a tie-up with SUNY Albany rather than with each other.

[Guest]

Also with regard to "Might there be a New York law school looking for a Los Angeles mate?", aw schools have enough trouble with teaching the modern law of one jurisdiction; what would they do with two jurisdictions? Take real property law, it is hardly ever taught as a state-specific course. Much of it is abstract 12th Century English property rights. Differences in residential title recordation systems barely merits a few minutes of class time. Given that, it seems hardly likely that courses would touch on differences in commercial real estate practice/financing in Manhattan and Wilshire Blvd.

[[M][@][C][K]]

My last post was done on an iPad - sorry for the typos.

Earlier this week there was an interesting post made by someone who uses the handle JustSayin

"No law school can break even when it has a student body of that size and still has to maintain a faculty to cover a typical curriculum, library, administrative staff in admissions, career services, etc., etc."

He made this comment with respect to Washington & Lee's recent restructuring, which would lead to a school of 300 enrolled (its currently circa 400.) I don't know if he is right about 300 being too small, but he is right about needing to bring costs into line. W&L law school is one of the oldest in the US, it does not lack prestige, and even so, its parent university has insisted that the bleeding be stemmed, that the school contract to a sustainable size (whether this will work is an open question, I suspect not - there are too many law schools in VA and in the VA, DC, NC catchment area that W&M serves.)

Now let's look at Hamline | Mitchell. In 2013-14, Hamline had 439 students, while William Mitchell had 809, a total of 1,248 . However, the announced future student headcount at the combined schools is "around 900," which is probably an overstatement since since the combined 1st year enrolment of both schools was 259 in 2014, which points to an enrolment going forward of circa 700, or around ½ the enrolment both schools had in 2010, when their combined 1st year enrolment was over 580. Both have seen already low GPAs and LSATs and GPA fall, currently Hamline's median GPA is 3.27 and median LSAT is 151; William Mitchell's median GPA is 3.25 and LSAT is 152 (down from an already unimpressive LSAT of 154 and 155 respectively.)

This collapse in enrolment is what is driving the merger. Both schools have fixed costs and structures built around at least double the enrolment they currently have, which means at least twice the revenue, before discounting. Allowing a conservative level of discounting of 20% (one Indiana professor admitted to 62% a few days ago by the way) and the two schools have seen a revenue fall of 60% since 2010. Worse still, in 2010 law schools were building and hiring based on the idea that 2010 was not the peak, but that tuition and enrolment could continue to rise - hence Hamline's

"state-of-the-art classrooms, the Annette K. Levine Moot Court Room, and a renowned law library ... Anderson Center, the hub of campus activity, bringing together good food, a full-service Starbucks, meeting rooms, meditative spaces, and the latest technology to support large and small gatherings ...The 4,000-square-foot Nelson Fitness Center with extensive strength and cardiovascular equipment for your use." (William Mitchell too claims state of the art facilities.)

So what is the attraction in the merger - right-sizing (they hope.) Staunching the bleeding, they hope. How - it is pretty obvious - lose one set of state of the art law school buildings (and turn them over the Hamline University to use for some other purpose), lose ½ the faculty, lose an entire administrative operation, hopefully ½ costs and - maybe, survive. A merger is simply a way of closing a law school and finding somewhere to transfer the rising 2Ls and 3Ls.

So what does a non-contiguous merger have to offer? Do you reduce the number of state of the art classrooms - uh, that would be a no! Do you reduce the number of faculty - no, you just give them a chance to teach their pet seminar (i.e., law and knitting) to a large group of loan conduits. Do you reduce the size of the administration - nope, actually it gets bigger as you need people to administrate the dual campusing and programs. And then there is the infrastructure and travel costs such a merger would entail. Since the purpose of a merger is really a closing with somewhere to transfer the 2Ls and 2Ls to, how attractive is a cross country merger to those students? It's one thing to go to classes 2 miles down the road, but very different to move from the east coast to the west, or take all classes by video link for 1-2 years. Non-contiguous mergers would seem insane in the current environment, since they would offer no cost reductions and the definite possibility of cost increases.

Make no mistake, there will be more law school mergers - more universities and colleges will decide that they need to shed their law school, as it becomes a cash drain, as its plunging LSAT scores and bar passage rates become an embarrassment. Those universities and colleges will all latch onto a cross-town or cross-state merger as the face saving way out - with one school disappearing. The interesting discussion will be around which college or university inherits (or is saddled with) the law school - I can hear the university presidents now:

"you have it"
"no you"
"but it's prestigious"
"but you need the prestige"
"no we don't, you do..."
"I'll trade you a dental school....."

[Jeff Redding]

@Mack: Thanks for your contributions but, in the future, please stay on topic and abbreviate your comments. It's very hard to follow.

More generally, to @Mack and @Guest, this post was clearly a thought-experiment in one way or another (one of the great pleasures of blogging). To push the 'argument' a bit further though, for all the potential problems with non-contiguous mergers--the Los Angeles/New York examples is an extreme one; let's not forget the more mundane ones that could happen across an arbitrary Midwest or East Coast municipal border--there are also very serious obstacles to contiguous mergers. If one isolates one variable, namely face-saving, it may be in some local contexts simply impossible for the local schools to be rational actors with each other for reasons pertaining to historical and contemporary competition/conflict. Thus, other schools, difficult as they may be, may become more natural merger partners.

And if face-saving is all that it is about--and I don't think it is--then what is to prevent a Los Angeles school from announcing a 'merger' with a New York School, renting a warehouse, and telling current and prospective students that all classes will from now on be taught in the warehouse via distance-learning-technology (sorry if that expression is either Orwellian or oxymoronic) deployed from a NYC law school?

[Orin Kerr]

Jeff asks: "What is to prevent a Los Angeles school from announcing a 'merger' with a New York School, renting a warehouse, and telling current and prospective students that all classes will from now on be taught in the warehouse via distance-learning-technology (sorry if that expression is either Orwellian or oxymoronic) deployed from a NYC law school?"

ABA Standard 306.

[Guest]

A non-contiguous merger also ignores that many lawyers practice in only one or two courthouses their entire career. LA/NYC or PA/NJ mergers don't add direct value to students whose career trajectories will be like that.

Likely, for most of these students, the best value is a single year of formal legal education in basic subjects and a few years of direct apprenticeship.

[[M][@][c][K]]

"it may be in some local contexts simply impossible for the local schools to be rational actors with each other for reasons pertaining to historical and contemporary competition/conflict" Moreover, your gedanken experiment runs into the basic problem that posters here have been setting out - it unrealistic. I can see why you think it is off-topic to have that explained - but so it is.

It did not stop Mitchell | Hamline.

Realistically, I have seen corporations dominated by autocratic CEO's with hefty shareholdings put historic competition and conflict behind them when the bottom line drove the deal. Most mergers are likely to be forced deals, where the parent institutions tell the law school to do it. A bigger problem is the possibly substantial difference in standing between the law schools.

So take a city where it would seem that a merger is an obvious solution - Birmingham Alabama, with three law schools. Why is a merger there unrealistic. The basic problem is that Birmingham School of Law and Miles School of Law are not ABA accredited, while Cumberland School of Law (Samford) is - can this big difference be overcome - to say that there is an enormous disparity in the bar passage rate would be an understatement 47%, 17% and 92% To merge the schools would be probably impossible. If you compare that to the Mitchell | Hamline situation - with schools had student bodies with very similar GPAs, LSAT scores and Bar Pass rates.

Ohio presents as a state with far too many law schools, nine total. So what obstacles are there to mergers there? Say Cleveland, with Case-Western and Cleveland-Marshall. Here the big one is that one school is a state school, the other private. A second issue is that Cleveland-Marshall is a substantially lower ranks school than Case-Western, with concomitantly lower LSAT scores and GPAs.

But looking at the near contiguous, Akron Law is 38 miles, 50 minutes from Cleveland Marshall - both are public, both are comparably ranked. Or Capital (Columbus) and Dayton? These look more feasible. So if your argument is that law school mergers may involve schools that are not within 2-3 miles of each other, but are say ½ hour to 1 hour apart, that may be realistic. Getting from American to GW in Washington DC, or Catholic for that matter takes 20 minutes to ½ hour and they are in the same city. If you are suggesting that law schools might merge across state lines, I think you have a point as regards the private law schools - an obvious candidate like Rutgers-Camden and a Philadelphia school would have the state/private problem as well as the Rutgers Newark issue to overcome, though the reality of PA's 8 law schools is impossible to ignore. Chicago and Northern Illinois offer several merger candidates. I am not going to even consider mergers in Florida (12 ABA law schools (cripes)) and California (61 law schools (you have to be kidding) 15 CA accredited, 20 ABA accredited plus 1 provisional ABA (that is still ludicrous)), or for that matter Tennessee's six law schools.

[Jeff Redding]

Orin: I tend to forget the ABA's rules, seeing how little enforcement they bring to the table. But for the sake of argument, and for learning, didn't they allow a variance to 306 to allow William Mitchell (as it was then known) to offer a radically new kind of online J.D.? This is what I'm referring to: http://web.wmitchell.edu/admissions/hybrid-program/course-sequence/. And here's the press-release: http://web.wmitchell.edu/news/2013/12/william-mitchell-to-offer-first-aba-accredited-hybrid-on-campusonline-j-d-program/.

[Barry]

Jeff: "And if face-saving is all that it is about--and I don't think it is--then what is to prevent a Los Angeles school from announcing a 'merger' with a New York School, renting a warehouse, and telling current and prospective students that all classes will from now on be taught in the warehouse via distance-learning-technology (sorry if that expression is either Orwellian or oxymoronic) deployed from a NYC law school?"

If one wishes to save face, there are limits to how transparent the facade can be.

[Jeff Redding]

Barry: That is true, and also a nice point.